The Sales Improvement Experts

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Bridging the gap between where your sales are today and where they could be tomorrow

What Price Salespeople?

iStock_000022503094SmallIf a company’s solution is complex or costly, face-to-face salespeople are essential.

However, face-to-face salespeople are very expensive.  In the US, the amount invested in sales forces was 5 times the amount spent on all media advertising in 2012 and 20 times the amount spent on all marketing & advertising in 2013.  Proportionally, the figures are the same in the UK.

According to Frank V Cespedes’ book, Aligning Strategy & Sales, the most expensive part of strategy implementation is aligning sales with a company’s goals.  These goals must include the value the company brings to its customers (customer value) and the value they expect to get from their customers (financial value).

Therefore salespeople must have the ability to customise a value proposition by marshalling the resources of their employers.  A value proposition is always at the core of a successful strategy.  Winning in business is achieved by delivering above average value to customers and a return to investors.

A company’s pay plan needs to motivate a sales force to achieve the company’s goals.  But salespeople’s pay structures need to be aligned with their employer’s financial results.  After all, a sale is only successful when a customer’s money appears in a supplying company’s bank account.

Too many companies, who need face-to-face salespeople, regard them as a cost rather than a good investment.  The message is that if a company needs face-to-face salespeople, they need to invest in well trained and regularly coached personnel.  Indeed, regular coaching of mid-level salespeople can deliver a 20% improvement in sales.  Yet over a third of companies don’t even train their salespeople, let alone coach them.

Are face to face salespeople worth it or should companies today find sales by other means?

13 Lucky Reasons to Outsource Sales

Outsourcing ConceptSales specialists on demand will reduce your costs

Some companies complain about the high cost of face to face sales.  However, if you need a direct field sales presence to end users but really want to keep costs down, outsourcing to sales specialists is the answer.  It will move the fixed costs of employing sales people (found on the P&L account) to variable costs (found on the balance sheet). Here are some telling statistics you may not know about –

a) Any company needs sales revenue of at least 5 times a field sales executive’s salary to cover that salary.

b) The cost of the average field sales force accounts for 40% of a company’s revenue.

c) The total salary package of the average field sales employee is only 38% of the total cost of that sales employee.

d) To get the average cost of running a sales employee, multiply their salary by 2.6.

The 13 reasons for the high costs of running field sales employees are –

    1. Basic salaries.
    2. Income tax.
    3. National insurance.
    4. Holiday pay.
    5. Sick days.
    6. Cars or car allowances.
    7. Office space.
    8. Office equipment.
    9. Recruitment and/or redundancy.
    10. HR support.
    11. Management support.
    12. Pension plans.
    13. Health insurance.

It’s also important to bear in mind that some sales employees will want to move into management eventually – successfully or otherwise. This means the loss of field sales people. However, outsourced sales specialists stay as they are.

How serious are you about keeping your sales costs down?

Feel free to comment below.

Close a sale or open an opportunity?

Closing a saleClosing a sale is a misnomer for winning business from a new customer.

The phrase should really be opening an opportunity because that’s exactly what you should have achieved.

In past decades, sales people have been taught various ploys to secure a signature on an order.   Most of these ploys are manipulative and insult the intelligence.  There are far too many to list here.

The best way to close a sale is to have a thorough but flexible sales process which can be tailored to the prospect.  After all, if the prospect says yes after each stage of your tailored process, they’re far less likely to say no at the end of the process.

The prospect needs to feel that you have their best interests at heart.  They will also need to see the financial benefits of doing business with you, as business is about money.  If you’re a good fit with their culture, as well as helping them reach their goals, they’re more likely to work with you.

As you should have already ascertained the prospect’s timescales, a start date ought to be fairly clear.  However, if there’s any doubt, all you need to ask is “When would you like to make a start?” or words to that effect.  No pressure or manipulative tactics are needed.

If there’s reticence on behalf of the prospect, it might be for the following reasons –

1)      Your value proposition is not sufficiently clear or beneficial.

2)      They may still doubt your company’s ability to help them.

3)      A competitor may be pitching hard for their business.

4)      Their purchasing or legal departments may be sitting on your proposal.

However, it could be that the prospect simply realises the time has come when all that’s left is to sign.  Psychologically this can be daunting for them, especially if a lot of money is at stake or fear of making the wrong decision grips them.  Often it’s best to step back and let them think it over for a month.

Ultimately, if you get no answer from your prospect, it’s best to write or email them withdrawing your proposal.  This seemingly drastic step often stimulates a reply.  After all, potential bad news is better than no news.

You can’t afford to clog up your sales pipeline with reluctant brides.

 Please comment below on your experiences of closing a sale and opening an opportunity.

Insight Selling – Points Against

Closeup of a woman hands holding a crystal ball with face slightly out of focusIs Insight Selling Out of Sight for SMEs?

It looks like we’re all trying to be insight sellers now – or are we?

In his book Duct Tape Selling John Jantsch says that you should help define the problems your prospects don’t know they have.  He suggests we should assume some of the issues a prospect might have and we should know more about the prospect’s business than they do.  However, I feel this may be stretching credibility too far.

Insight selling correctly emphasises the importance of measuring performance.  However, there don’t appear to be many statistics measuring the difference between companies now using insight selling, compared to whatever method those companies previously used.

Linda Richardson in her book Changing the Sales Conversation, says that client insight refers to the data gathered about clients to predict their future needs.  She goes on to say that when you share this insight, you can challenge a client’s thinking and make them aware of the risks & problems they may have missed or undervalued.

Only large companies can really afford to employ full time personnel to mine data to this degree.  Alternatively they can afford to outsource this function.  However, most SMEs would be stretched to manage this.  Beyond checking out a B2B prospect on their website, Google, LinkedIn and Companies House, most SMEs would have to settle for well-trained salespeople with imagination – at best.

I know solution selling is being replaced by insight selling in many larger companies. Indeed according to McKinsey, 80% of salespeople have discarded solution selling owing to its complex questioning cycle.  However, it’s tempting to imagine the next incarnation of the sales process being called clairvoyance selling.

How valid is insight selling for every company with face to face sales professionals?

Insight Selling – Points in Favour

Breaking ideaHow Insight Selling Leads to Customer Collaboration

As buyers get savvier and selling gets harder, is insight selling  the answer for salespeople?

This year there have been several books and numerous blogs on the subject of insight selling.  Michael Harris says in his book Insight Selling that buyers today are flooded with too much information.  Salespeople need to act as a filter, clarify the buyer’s thoughts and be a guide in the buyer’s purchasing process.

As Mike Schultz & John E. Doerr say in their book, also called Insight Selling, salespeople need to establish credibility by demonstrating keen insight into the buyer’s world.  This insight can be found in several ways including social media, buyer’s websites, financial details, industry sector knowledge and trigger events.

They go on to say that salespeople need to educate buyers with new ideas and help them visualise how a solution will improve their situation.  They emphasise that the fear of loss is greater than the desire for gain.  Therefore buyers need help driving higher profits without higher headcount.  If the salesperson can collaborate with the buyer to help them reach such a goal, trust will ensue.  The more buyers see salespeople as a source of insight, the more buyers will include salespeople early in their buying process.

Sales Performance International report that when salespeople engage first with a buyer, they win business over five times more often than sellers who wait for buyers to engage them.  Therefore, the earlier salespeople are involved in the customer’s buying process, the greater the chance of winning.

This is just as well as a CSO Insights study shows that marketing departments provide only 33% of qualified leads.  Therefore, salespeople must take responsibility for generating their own leads.  As Paul R. Dimodica says in his book Revenue Capture Scorecard, “The simple goal of marketing is to create inbound leads that generate revenue.  If marketing doesn’t, it’s failed and you need to let your salespeople hunt alone and increase online presence”.

What impact is insight selling having on your sales?

Sales Coaching versus Sales Training.

Sales TrainingAccording to CSO Insights only 25% of companies have a formalised sales coaching process.

 

The CSO report also studied 4,500 organisations and found that companies with defined sales coaching were –

  1. Twice as likely to be regarded by customers as trusted advisors.
  2. 17% more likely to hit quota.
  3. Actually won 24% more forecasted sales.

However, in their book Insight Selling by Mike Schultz and John E Doerr, they write that most sales training focuses on a 2-3 day event where sellers learn new skills.  The problem is that between 85% and 90% of sales training has no lasting impact after 4 months.

Indeed John Neill, chairman & CEO of Unipart Group, recently stated in the Sunday Times that less than 20% of any external training is effective in gaining performance.

Certainly to reinforce sales training for lasting impact, sales coaching is needed.  In fact it’s quite possible to provide one-to-one, on-the-job sales coaching without the expense of taking salespeople out of the field for several days on expensive sales training courses.

In his book Coaching Salespeople into Sales Champions, Keith Rosen describes a 28 day turnaround strategy based on 4 weekly benchmarks.

How good are your sales managers at providing sales coaching?

Feel free to comment below.

10 steps to a winning sales proposal.

Sales ProposalWhether you’ve been asked to present a sales proposal or not, you will have to provide a written document.

However this shouldn’t be a vain attempt at War & Peace or Bleak House.  If ever there was a case of less being more, this is it.  With the exception of major bids or specific requests for proposals (RFP’s), written sales proposals need not exceed four pages at most.  So how do you write a winning sales proposal?  Well, you need to include just ten headings –

1)      The prospect’s current situation.

2)      Their goals, aims or objectives for the next one or two financial years.

3)      The issues, problems or challenges preventing their goals being reached.

4)      Key activities you will undertake to help the prospect achieve their goals.

5)      Joint accountabilities – exactly what you and the prospect are responsible for.

6)      Financial expenses in detail.

7)      Payment terms (in two parts) –

  1. The financial contribution your input will make to the prospect’s business.
  2. Two or three payment options.

8)      Timing – comprising of the project’s start date and when the prospect pays you.

9)      Acceptance (in two parts) –

  1. The payment option in number 7b. to be chosen
  2. Signatures indicating acceptance of the details, terms & conditions above.

10)  Appendix or addendum – any and all relevant specifications, technical details and corresponding literature.

Opinions differ as to how such a written proposal should be delivered.  One school of thought is that it should be presented, or at least handed over personally, so that a closing discussion may take place.

However, there is another school of thought suggesting a proposal should be emailed or preferably sent by courier.  Consulting advisor Alan Weiss believes a proposal should reflect what has already been discussed and verbally agreed, including pricing.  He reasons that in another meeting, the prospect could raise further issues or want to negotiate.  Alan Weiss argues that a proposal isn’t a negotiating document, so why return in person to discuss it?

 Is this a valid point or should the prospect decide?

Feel free to comment below.

What to do in a second sales meeting.

iStock sales coachingSo you’ve had your first meeting.  You’ve been invited back to discuss matters in more detail.  How do you conduct a second sales meeting?

You need to check with the prospect what you learned in the first meeting, namely their –

1)      Objectives.

2)      Plans & timescales to reach those objectives.

3)      Issues which may prevent those objectives being reached.

4)      Costs of those issues.

It’s important to bring prepared ideas to this meeting.  These can be in the form of three options.  (According to Mike Schulz and John E Doerr in their book Insight Selling, only 21.5% of prospects felt salespeople gave them new ideas.)  These options will help achieve the objectives detailed in the first meeting.  Ask the prospect if, or how, each option might be helpful in tackling their issues.

In her book Changing the Sales Conversation, Linda Richardson emphasises the need to create a business case.  This should show financial impact by comparing the prospect’s cost with the monetary value of your options.  Buyers measure value by comparing cost with investment.  Quantify the impact of your options when delivering business outcomes.

You also need to find out if the prospect is expecting a more detailed proposal, based on any or all three of your options.  If they do, one way to increase the likelihood that it wins the business is to ask the prospect to review the proposal before the actual presentation date.  Suggest that you can work out any problems, come to a verbal agreement in principle and then submit the proposal.  On this understanding, it’s possible to ask for the business there and then, thereby avoiding the presentation of an official proposal altogether.

What works well for you at a second sales meeting?

Feel free to comment below.

How to ensure a 2nd sales meeting with a prospect.

2nd sales meeting, coupleAccording to Forrester Research only 7% of buyers schedule a 2nd meeting with sellers.  So how do you make sure you’re one of them?

Firstly you have to refer back to your first meeting with the prospect company.  Then you should have uncovered their –

1) Main aims and the value of those aims.

2) Action plan and its timescale.

3) Issues which might prevent those aims & plans being achieved.

4) Costs of such issues.

5) Buyer’s names in their decision making unit.  (A 2013 CSO Insights study found that 75% of B2B purchases included at least 3 buyers and that 40% of salespeople fail to identify them.)

If you email your initial contact with these details, and the contact agrees with them, you’re on your way to a second meeting.

In their book The Collaborative Sale by Keith M Eades & Timothy T Sullivan, they suggest using a Collaboration Plan.  Based on the first meeting, the buyers can make changes and additions thereby taking ownership.  The Collaboration Plan can show you –

1) Something of the prospect’s buying process.

2) Revenue predictability.

3) Identification of a closing date.

4) Risk reduction.

 How do you ensure 2nd sales meetings with your prospects?

Feel free to comment below.

What’s the best system for sales presentations?

Sales presentationIf a prospective customer  expects you to present a proposal to them, you now have more choices at your disposal than just slides.

 

Aberdeen Research states that conducting an interactive whiteboard presentation leads to a 50% higher conversion rate.

According to the book Whiteboard Selling by Sommers & Jenkins, people retain less than 20% of what is presented to them using slides.

A whiteboard presentation should take no more than 15 minutes.  If you start a presentation by writing on the board what you know about your prospect’s situation, goals, challenges and plans, your credibility will be greatly enhanced.  You will earn the right to continue the discussion to create a shared vision, including the next steps.

If you have a large audience or no access to a whiteboard, you can use a digital product called Papershow.  It enables you to create and project your whiteboard from paper onto a screen, in front of your prospects.

However, if you feel you need to use slides, here are 5 tips –

1)      The fewer slides you use the better.  More than ten is too many.

2)      Make the slides photos or images in preference to text.

3)      If you must use text don’t use bullet points.

4)      If you must use bullet points use numbers instead – and only up to three per slide.

5)      If you do use text don’t read straight from the slides – slides must be prompts only for you and mean something significant to the prospect.

How do you present to customers?  What works best for you?

Feel free to comment below.